SEATTLE — Starbucks Corp.’s second-quarter profit fell 28 percent as U.S. consumers responded to rising food and gas prices by making fewer latte runs.
For the quarter ended March 30, Starbucks’ net income sank to $108.7 million, or 15 cents per share, from $150.8 million in the same period last year.
Revenue rose 12 percent to $2.53 billion from $2.26 billion in the year-ago quarter, the company said Wednesday.
Starbucks warned last week that results would fall short of Wall Street’s expectations. Analysts, on average, had forecast a profit of 21 cents per share on $2.63 billion in sales, according to a Thomson Financial survey.
“We continue to come under very heavy consumer pressure due to the economy,” said Chairman and Chief Executive Officer Howard Schultz. “Most retailers, restaurants, certainly other premium brands are facing similar headwinds.”
Charges for closing a few stores and not moving forward with some planned openings, as well as costs associated with Starbucks’ plan to reinvigorate U.S. sales, such as added benefits for loyalty card holders, cut earnings by about 3 cents per share.
U.S. same-store sales, a key measure of retail health, fell in the mid-single digits as traffic declined. Starbucks’ past guidance called for 3 percent to 5 percent growth in same-store sales, or sales at locations open at least a year.
Starbucks added 266 U.S. stores in the quarter, and 470 outside the country, bringing the worldwide total to 16,226.
Starbucks brought Schultz back as chief executive in January after a year of sinking share prices, as the company’s rapid U.S. growth outpaced demand and sapped stores of their charm, making it easier for McDonald’s Corp. and other chains to compete.
So far, his moves have included a new signature coffee available in every U.S. store every day. Schultz said the new Pike Place Roast is “driving incremental customers to stores.”
Schultz also said the company would launch three new types of drinks in U.S. stores this summer: a health-conscious smoothie-style line, an icy Italian coffee-based drink and an energy drink that adds extra kick to the existing Starbucks DoubleShot, which is sold in cans.
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